Huntsman receives $325 million termination fee from Hexion

By Lisa Kerner

Charlotte, N.C., Dec. 19 - Huntsman Corp. said it received the $325 million termination fee from Hexion Specialty Chemicals, Inc.

Hexion agreed to pay the fee in connection with a $1 billion settlement between Huntsman, Hexion, Apollo Management, LP and some of its affiliates, a Huntsman news release said.

Huntsman said it expects to receive another $250 million payment from Apollo affiliates by the end of the year, and some funds managed by Apollo also agreed to purchase $250 million principal amount of Huntsman senior convertible notes.

Remaining payments totaling $175 million are due on or before March 31.

In July 2007, Hexion agreed to acquire Huntsman in an all-cash transaction valued at $10.6 billion.

The settlement with Hexion and Apollo does not resolve Huntsman's multi-billion-dollar claims against Credit Suisse and Deutsche Bank that the banks conspired with Apollo and interfered with Huntsman's agreement with Basell AF and later Hexion, it was previously reported.

A jury trial on those claims is set to begin on May 11.

In October, the banks backed out of their commitment to fund a merger of Huntsman and Hexion over solvency issues of the proposed combined company, it was previously reported.

Based in Columbus, Ohio, Hexion makes thermoset resins. Huntsman is a Salt Lake City manufacturer of differentiated chemicals and pigments.

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